As you may have noticed, the price of gold has been falling this week. It hasn’t fallen enough to significantly diminish this year’s gains, but any kind of fall in price can make people nervous.
The fall came about as a result of the strengthening of the dollar. When that happens, big gold investors cash in their gold profits and invest their gains elsewhere.
However, do you expect the dollar to remain strong? Interesting question. Many would suggest that none of the fundamental causes for its decline in value have been corrected this week, so we can anticipate another dip in its value, and a corresponding rise in the price of gold.
All that said, how much do these ups and down in prices mean to you, as a gold buyer and owner?
Investors stress about daily and hourly fluctuations in gold prices. That’s how they make and lose money.
But if you buy gold to own, and own it as a means to keep at least some of your wealth safe from really wild declines in the stock market, then you shouldn’t be worried about what has been happening this week at all.
The benefits of owning gold, as a safety net, are long term. The value of an ounce of gold day-to-day should mean very little to us.
Besides which, we will have no reason to cash in our gold unless the economy really crashes. And if the economy crashes, the price of gold will rise dramatically.
In other words, while traders and investors worry about the small ups and downs in prices, gold owners are in it for the long term, hopefully, and will only want or need to cash in at a time when gold prices are literally going through the roof.